The Conference Board U.S. Business Cycle IndicatorsSM THE ...

1 FOR RELEASE: 10:00 ET, Thursday, October 21, 2021 The Conference Board Business Cycle IndicatorsSM THE Conference Board LEADING ECONOMIC INDEX (LEI) FOR THE UNITED STATES AND RELATED COMPOSITE ECONOMIC INDEXES FOR SEPTEMBER 2021 The Conference Board Leading Economic Index (LEI) for the increased percent, The Conference Board Coincident Economic Index (CEI) remained unchanged, and The Conference Board lagging Economic Index (LAG) increased percent in September. The Conference Board LEI for the increased again in September. Positive contributions from six out of ten components more than offset the negative contributions.

2 The residential building permits component made the largest negative contribution. In the six-month period ending September 2021, the leading economic index increased percent (about a percent annual rate), faster than the growth of percent (about a percent annual rate) over the previous six months. In addition, the strengths among the leading indicators have remained more widespread than weaknesses. The Conference Board CEI for the , a measure of current economic activity, was unchanged in September. The coincident economic index rose percent (about a percent annual rate) between March and September 2021, down from growth of percent (about a percent annual rate) over the previous six months.

3 Strengths among the coincident indicators have remained very widespread, with all but one component advancing over the past six months. The lagging economic index continued to increase in September; with CEI unchanged, the coincident-to- lagging ratio thus declined. Real GDP expanded at a percent annual rate in the second quarter of the year, after increasing percent (annual rate) in the first quarter. The Conference Board LEI for the continued to rise in September, but at a slower pace than in the past several months. Meanwhile, The Conference Board CEI for the has also been rising slowly, and its six-month growth rate has declined as well.

4 Taken together, the current behavior of the composite indexes and their components suggest that the expansion in economic activity will continue but possibly moderate somewhat in the near term. LEADING INDICATORS. Six of the ten indicators that comprise The Conference Board LEI for the increased in September. The positive contributors beginning with the largest positive contributor were the ISM New Orders Index, the interest rate spread, average weekly initial claims for unemployment insurance (inverted), the Leading Credit Index (inverted), manufacturers new orders for nondefense capital goods excluding aircraft*, manufacturers new orders for consumer goods and materials*.

5 The negative contributors beginning with the largest negative contributor were building permits, average consumer expectations for Business conditions, average weekly manufacturing hours, stock prices. The LEI for the increased percent in September and now stands at (2016=100). Based on revised data, this index increased percent in August and increased percent in July. Over the six-month span through September, the leading economic index increased percent, with seven out of ten components advancing (diffusion index, six-month span equals 70 percent).

6 The next release is scheduled for November 18, 2021, Thursday at 10 ET COINCIDENT INDICATORS. Three of the four indicators that comprise The Conference Board CEI for the increased in September. The positive contributors to the index beginning with the largest positive contributor were employees on nonagricultural payrolls, personal income less transfer payments* and the manufacturing and trade sales*. The negative contributor was industrial production. The CEI remained unchanged in September and now stands at (2016=100). Based on revised data, this index increased percent in August and increased percent in July.

7 During the six-month period through September, the coincident economic index increased percent, with three out of four components advancing (diffusion index, six-month span equals 75 percent). lagging INDICATORS. The Conference Board lagging Economic Index for the increased percent in September and now stands at (2016=100), with four of its seven components advancing. The positive contributors to the index beginning with the largest positive contributor were the average duration of unemployment (inverted), commercial and industrial loans outstanding*, change in the index of labor cost per unit of output, manufacturing*, and the ratio of manufacturing and trade inventories to sales*.

8 The negative contributors beginning with the largest negative contributor were the change in CPI for services and the ratio of consumer installment credit outstanding to personal income*. The average prime rate charged by banks held steady in September. Based on revised data, the lagging economic index increased percent in August and increased percent in July. DATA AVAILABILITY AND NOTES. The data series used to compute The Conference Board Leading Economic Index (LEI) for the , The Conference Board Coincident Economic Index (CEI) for the and The Conference Board lagging Economic Index (LAG) for the and reported in the tables in this release are those available as of 8:30 am ET on October 19, 2021.

9 Some series are estimated as noted below. * Series in The Conference Board LEI for the based on our estimates are manufacturers new orders for consumer goods and materials and manufacturers new orders for nondefense capital goods excluding aircraft. Series in The Conference Board CEI for the that are based on our estimates are personal income less transfer payments and manufacturing and trade sales. Series in The Conference Board LAG for the that are based on our estimates are manufacturing and trade inventories to sales ratio, the change in labor cost per unit of output, manufacturing, consumer installment credit to income ratio, and the personal consumption expenditure deflator used to deflate commercial and industrial loans outstanding.

10 The procedure used to estimate the current month s personal consumption expenditure deflator (used in the calculation of commercial and industrial loans outstanding) incorporates the current month s consumer price index when it is available before the release of The Conference Board LEI for the For further information contact: Joe DiBlasi 781-308-7935 / Indicators Program: Email: Website: THE CYCLICAL indicator APPROACH. The composite economic indexes are the key elements in an analytic system designed to signal peaks and troughs in the Business Cycle .